Alaska Air Group provides passengers and cargo air transportation services primarily in the United States. The company operates through Alaska Mainline and Alaska Regional segments. The company was founded in 1932 and is based in Seattle, Washington.
ALK Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Alaska Air Group Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Alaska Air Group Inc ranked in the 68th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 161.83%. As for the metrics that stood out in our discounted cash flow analysis of Alaska Air Group Inc, consider:
As a business, ALK is generating more cash flow than 80.69% of positive cash flow stocks in the Industrials.
Alaska Air Group Inc's weighted average cost of capital (WACC) is 6%; for context, that number is higher than merely 4.3% of tickers in our DCF set.
ALK's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than merely 4.3% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Alaska Air Group Inc? See BWEN, ASGN, QRHC, WSC, and TKR.
Starting today, Alaska Airlines customers and members of the award-winning Mileage Plan have three new promotions to enjoy. In addition to guaranteeing 2020 elite status through 2021, the airline is extending a 50% bonus of elite qualifying miles for flights taken through the end of the year. Plus, for the first time ever, Alaska Airlines Visa® cardholders can use their card to earn elite qualifying miles, and consumer cardholders can earn double miles for qualifying restaurant purchases.
Looking into the current session, Alaska Air Group Inc. (NYSE: ALK) shares are trading at $36.20, after a 5.8% increase. Moreover, over the past month, the stock spiked by 24.96%, but in the past year, decreased by 40.52%. Shareholders might be interested in knowing whether the stock is undervalued, even if the company is performing up to par in the current session.The stock is currently higher from its 52 week low by 80.82%. Assuming that all other factors are held constant, this could present itself as an opportunity for investors trying to diversify their portfolio with Airlines stocks, and capitalize on the lower share price observed over the year.The P/E ratio measures the current share price to the company's earnings per share. It is used by long-term investors to analyze the comp...
Alaska Air Group (NYSE: ALK) isn't the best-known airline nationally, but for years it has quietly been one of the industry's top performers, flying passengers up and down the west coast and blanketing the Pacific Northwest with flights. The airline flew into some turbulence in 2016 when it won a bidding war to acquire Virgin America, but entered 2020 with the integration largely complete, and Alaska once again focused on its core historical markets. The COVID-19 pandemic has changed everything for Alaska and the rest of the airline sector, causing travel demand to evaporate and starving the industry of revenue.
Airline shares were flying higher again on Wednesday, the sector's second straight day of posting double-digit gains on improving optimism that the U.S. economy is in the early stages of a recovery. Shares of Spirit Airlines (NYSE: SAVE) led the way at the open, jumping 18%, while shares of American Airlines Group (NASDAQ: AAL), United Airlines Holdings (NASDAQ: UAL), JetBlue Airways (NASDAQ: JBLU), Alaska Air Group (NYSE: ALK), Hawaiian Holdings (NASDAQ: HA), and Allegiant Travel (NASDAQ: ALGT) were all up double digits.